Employees are key to the success of any business, but finding the best talent and keeping them happy can certainly come at a cost.
Online recruitment portal Glassdoor states that it costs an average of £3,000 to hire a new recruit for your business – plus there are ongoing costs in terms of equipment they require, employee benefits and salary increases to include in the mix.
With this in mind, we present some powerful ways to save money on hiring and managing your staff, speaking to some employers along the way.
Avoid the recruiters, start with your own staff
Recruiters certainly have their place, especially for finding highly specialised staff or helping you to achieve your recruitment goals. However, this often comes at a cost, where a percentage of the candidate’s annual salary is paid as a commission to the recruiter – and this can be anywhere from a few hundred to a few thousand pounds.
Before going down the recruiter route, consider asking your own staff if they can recommend anyone good, whether it is a family member or friend. Your own employees are bound to know like-minded people and anyone that they can find through their own list of contacts or from using Linkedin is ultimately free and very cost-effective for the business.
Who said it needs to be a 5-day week?
Let’s be real, Fridays are a very quiet day. No major decisions are typically made and people often have long lunches and leave early.
“You can consider giving your staff a 3-day or 4-day contract,” explains Ben Sweiry of finance startup, Dime Alley.
“Staff are not cheap, but cutting out the Friday can save you 20% on their employment bill and it also has benefits. Some staff enjoy having a quiet Friday to refresh and then they return on Monday, full of energy. Similarly, some staff work much harder knowing that they only have 3 days a week to get some tasks done.”
Join the remote working wave
Whilst remote working has been around for decades, it has certainly become mainstream since the covid pandemic. In fact, most new candidates these days expect a certain number of days will involve working from home.
By encouraging staff to work from home, you can save costs on your offices and this includes rent, computers, furniture, teas and coffees. Or for the very least, by operating a hybrid model of working in an office and from home, you can certainly save money by having less desks or a more affordable office.
Can you pay staff on credit?
Of course, you will always pay your staff either weekly, fortnightly or at the end of the month, but is there a way to save money on this or improve your cash flow?
“You can consider paying your staff on credit,” explains Richard Dent, founder of payment startup, Finger Finance.
“With access to business credit cards or connecting your AMEX card to Paypal or Stripe, you have the opportunity to pay staff immediately but to delay payment for 30 to 45 days.”
“Using business credit products often comes with cashback, saving you money, or with points, which can be used for employee perks or for travel.”
“You should always pay this debt off, since it is not healthy financially to rely on revolving credit.”
Consider employee benefits that are free
Part of managing your staff is offering employee benefits such as health insurance or life insurance, but again these come at a cost.
One money-saving opportunity is to ask your staff what they value the most. If they have small children, they may wish to have more time-off, which of course is free to the business. Or perhaps, they might prefer to start work a little later so they can do the school run.
But employee benefits, do not always need to be VIP days out or snazzy lunches, they can more sentimental and tailored to the individual – and sometimes, the best things in life are free.
You can also apply for things like childcare vouchers and other employer schemes from the government.